International Journal of Innovation Management

International Journal of Innovation, Management and Technology, Vol. 1, No. 4, October 2010
ISSN: 2010-0248
374
Abstract—This paper presents an exploratory study of lean
manufacturing implementation in Malaysian automotive
industries. A questionnaire survey is used to explore the extent
of lean manufacturing implementation. This paper also
examines the drivers and barriers that influence the
implementation of lean ma nufacturing. The survey was
performed on sixty Malaysian automotive components
manufacturing firms. The respondents were chosen from those
who are directly involved with lean manufacturing practices
such as production and quality personnel. The findings show
that most of the respondent firms are classified as in-transition
towards lean manufacturing practice. These in-transition firms
have moderate mean values for each of the five lean
manufacturing practice categories. It is also found that these
firms spend more attentions and resources in internal areas
such as firms’ operation and management, compared to
external relationships with suppliers and customers. These
firms believe that the factors that drive the implementation of
lean manufacturing are the desire to focus on customers and to
achieve the organisation’s continuous improvement. The results
from this survey also revealed the main barriers that prevent or
delay the lean implementation. The main barriers to implement
lean manufacturing system are the lack of understanding lean
concepts and shop floor employees’ attitude.
Index Terms—Lean manufacturing, automotive industry,
Malaysia
I. INTRODUCTION
Heightening challenges in today’s global competition have
prompted many manufacturing firms to adopt new
manufacturing management strategies in order to enhance the
firms’ efficiency and competitiveness. Manufacturing firms
has taken lean manufacturing (LM) system as a great
management tool and many of them have adopted lean
techniques in many different forms and names.
Now, LM has become a widely acceptable and adoptable
best manufacturing practice across countries and industries
[1]. The ultimate goal of a lean organisation is to create a
smooth and high quality organisation that is able to produce
finished products concerning the customers demand in the
quality looked-for with no waste. However, in reality, many
companies are not able to transform themselves to a lean
manufacturing organisation towards creating the world-class
companies. Actually the transformation towards LM is filled
with formidable challenges, most particularly to understand
the real essence of LM concept and philosophy [2], and also
to deal with the cultural differences issues either national or
organisational [3-6].
There are a few studies that have been done in Malaysia
based on lean manufacturing implementation. Study done by
Wong et al. [7] focussed to examine the adoption of lean
manufacturing in the Malaysian electrical and electronics
industries. From his study it is found that most of the
Malaysian manufacturing industries have been implemented
lean manufacturing system to some extent. However,
findings based on Malaysian manufacturing industries do not
indicate the holistic perspective of lean manufacturing
implementation. It is also found that the degree of lean
implementation in those industries was based on the average
mean score of individual keys of lean practices areas, not the
total average mean score.
Therefore, the purpose of this study is to further discuss
the LM implementation in Malaysian manufacturing
industries. The investigation focuses on the degree of LM
implementation in Malaysian automotive industries. In
addition, the factors that are capable to hinder or delay the
lean implementation process are also investigated. Hopefully
this study will help the firm’s management to identify the
problems to implement an effective LM system.
II. LITERATURE REVIEW
The concept of LM was pioneered by a Japanese
automotive company, Toyota, during 1950’s which was
famously known as Toyota Production System (TPS). The
primary goal of TPS were to reduce the cost and to improve
productivity by eliminating wastes or non-value added
activities [8]. During 1980’s there was an intense interest on
LM implementation among the western manufacturers
because of growing Japanese imports. It became a serious
concern to the western producers [1]. After the oil crises in
the early of 1990’s, in a published book named The Machine
that Changed the World [8] by International Motor Vehicle
Programme (IMVP), such intense interest of LM concept was
again aroused. Then, the concept of LM was transferred
across the countries and industries due to its global
superiority in cost, quality, flexibility and quick respond [9].
LM is a manufacturing strategy that aimed to achieve
smooth production flow by eliminating waste and by
increasing the activities value. Some analysts even pointed
out that if an organisation ignores the LM strategy, the
company would not be able to stand a chance against the
current global competition for higher quality, faster delivery
A Survey on Lean Manufacturing
Implementation in Malaysian Automotive
Industry
Norani Nordin, Baba Md Deros and Dzuraidah Abd Wahab

International Journal of Innovation, Management and Technology, Vol. 1, No. 4, October 2010
ISSN: 2010-0248
375
and lower costs [10, 11]. In a large cross-country analysis
done by Oliver et al. [12] proves that LM principles could
produce high performance firms.
LM consists of a large number of tools and techniques.
Shah and Ward [13] identified twenty two LM practices that
are frequently mentioned in literatures and categorised them
into four bundles associated with Just-in-Time, Total Quality
Management, Total Preventive Management and Human
Resource. Some other researchers also categorised the lean
tools and techniques according to the area of implementation
such as internally and externally oriented lean practices
[13-15]. For example Panizzolo [15] divided the lean
practices into six areas which are process and equipment;
manufacturing, planning and control; human resources;
product design; supplier relationships; and customer
relationships. The first four areas are grouped as internal
oriented lean practices, whereas supplier relationships and
customer relationships are under external oriented lean
practices. This study also confirms that, many firms seem to
have difficulty in adopting lean tools that concern with
external relationships with suppliers and customers even for
high performance firms. Empirical results from this study
also prove that lean tools in internal areas are adopted most
widely in the firms, where the operation and management
methods are more direct.
The change from traditional manufacturing system to lean
manufacturing is not an easy task. Achanga et al. [16]
suggested that the success of LM implementation depends on
four critical factors: leadership and management; finance;
skills and expertise; and supportive organisational culture of
the organisation. Some researchers also suggested that
applying the full set of lean principles and tools also
contribute to the successful LM transformation [4, 17].
Despite the huge benefits gained from LM implementation
is highlighted, in reality not many companies are successful
to implement this system [2, 18]. There are numerous
reported problems and issues regarding the failure of LM
implementation. Many researchers believed that the main
problem lies on the misunderstanding of the real concept and
purpose of LM [2, 9]. Some researcher identified the reason
of this misunderstanding is due to cultural differences that
occurs during transition or translation of LM [4, 17]. This
type of misunderstanding could lead to more major issues
such as piecemeal adoption of lean tools and techniques [17],
misapplication of lean tools [4, 19], and lack of development
of lean culture that support the lean development [5, 20].
Study done by Puvanasvaran et al. [21] showed that the
company which is in the early stage to become lean, must
keep its efforts for an effective communication process at all
levels in order to be successful in LM implementation. Good
communication process supports the lean practices in
manufacturing.
III. RESEARCH METHODOLOGY
A questionnaire was developed to collect data for this
study. In order to achieve the objectives of the study, the
Malaysian automotive manufacturing firms were selected as
the population. The database was obtained from the 2008
Federation of Malaysian Manufacturers (FMM) and SME
Corp Malaysia directories. This list of the manufacturing
firms consists of electrical, electronic, metal, plastic, rubber
and other automotive components. The manufacturing firms
involved in this study were ranged from medium to large
companies, with more than 50 employees. According to SME
Corp Malaysia [22], medium companies are those with full
time employees between 51-150, whereas large companies
are companies that have full time employees more than 151.
The decision made in this study is based on the studies done
by Shah and Ward [13, 23], Bonavia and Marin [24], and
Perez and Sanchez [25]. From their studies it is shown that
small manufacturing firms are less likely to implement LM
concepts due to certain limitations and barriers. The
personnel involved in the survey were those from managing
directors, manufacturing and/or production managers and
executives, and also quality managers and executives.
The questionnaire consisted of three parts; (a) the
background information of the organisation (year of
establishment, ownership, number of employees, and quality
system certification), (b) the lean manufacturing
implementation (lean practices implementation, lean drivers,
benefits and barriers), and (c) the respondent information
(job title, department and years of employment).
The items of lean manufacturing implementation section
were adapted from Shah and Ward [13] and Panizzolo [15].
The questions were set up on a five-point Likert scale to
measure the extent of implementation described by each of
the items. The scale was ranged from 1 to 5 where 1 = no
implementation, 2 = little implementation, 3 = some
implementation, 4 = extensive implementation, and 5 =
complete implementation. The prime consideration of the
design in this survey instrument was to keep it short and
focused in order to obtain an adequate response rate.
The process of developing the questionnaire also included
a pilot survey. This pilot survey was used to modify and
eliminate the number of variables. Experts from industries
and academics were also consulted. The comments and
feedback were analysed and a few minor modification were
made especially in questionnaire format. Majority of the
feedback from the experts gave positive remarks and certify
that the questionnaire was acceptable for data collection.
Although no new items were added for the data collection
phase, but many items were reworded or modified. The
questionnaire was then ready for data collection.
In the case of reliability test, Cronbach’s alpha was
employed to measure the internal consistency of the research
instrument. According to Sekaran [26], reliability
measurement is an indication of the stability and consistency
of the instrument. The generally agreed value of the lower
limit for Cronbach’s alpha is 0.70, although it may be as low
as 0.60 in exploratory research [27].
The internal consistency of the elements of lean practices
and lean barriers were tested by using SPSS reliability
analysis procedure. The analysis was performed separately
for the items of each factor. The summaries of the reliability
analysis are given in Table 1. All the results proved the
survey instrument ha high internal consistency with

International Journal of Innovation, Management and Technology, Vol. 1, No. 4, October 2010
ISSN: 2010-0248
376
Cronbach’s alpha values ≥ 0.70 and therefore it is reliable.
TABLE 1: RELIABILITY TEST RESULTS - LEAN PRACTICES AND LEAN BARRIERS
Description No. of items Alpha value Items for deletion Alpha if item deleted
Lean practices
1. Process and equipment 9 0.871 - 0.890
2. Manufacturing planning and control 5 0.865 - 0.865
3. Human resources 5 0.878 - 0.878
4. Supplier relationship 5 0.791 - 0.791
5. Customer relationship 3 0.809 - 0.809
Lean barriers 10 0.900 - 0.900
IV. RESULTS AND DISCUSSIONS
The initial email was sent to 250 target respondents. The
email addresses were obtained from the phone calls made to
each of the companies listed in the database. From the emails,
17 emails were failed to deliver. This may be due to the
reason that either the email addresses were wrong or the
person had been left that company. Another follow-up email
was sent after one week later to remind the respondents who
had not responded yet and thanks were given to those who
had already returned their questionnaire. A total of 19
responses were returned, 11 of them were online survey and
the remaining 7 were sent through email. This actually gave
quite a low response rate of 7.6%. However, since the initial
response rate was not satisfactory and for this reason another
method was seek. To increase the response rate the
questionnaire was send to the respondents through postage
mail. As a result of this, the number of responses was rose to
61 and consequently the response rate was reached to 24.4%.
A. Respondent profile
The first aspects to be investigated were the general
background of the respondents and the companies involved.
Table 2 shows the general background of the respondents
such as the job position and years of employment in the
company. It was found that the respondents were mainly
Production and QC/QA personnel. Most of them (36.1%)
have been working more than 10 years in that particular
company. They were selected because they have first hand
knowledge and experience and they were directly involved to
the implementation of lean manufacturing program in their
companies.
TABLE 2: GENERAL BACKGROUND OF THE RESPONDENTS IN THEIR
COMPANY (N = 61)
n %
Position in the company
Production Manager &
Executives
2
6
42.
6
QC/QA Manager & Executives 2
6
42.
6
Others 9 14.
8
Years of employment
<5 years 2
0
32.
8
5-9 years 1
8
29.
5
>10 years 2
2
36.
1
Table 3 shows the general background of the companies
involved in the study. The factors investigated were the types
of product, age, ownership, size and quality management
system of the company. Most of the respondent companies
manufacture metal parts for automotive industries (44.3%).
Majority of the companies involved in this study are
categorised as intermediate and old companies with 42.6%
each. The old company defined in this study are those which
were established more than 20 years ago. By comparison, the
intermediate companies are those which have been
established between 11 to 20 years. New companies are
defined which established less than 10 years ago. The
percentage of new companies was only 13.1%.
TABLE 3: GENERAL BACKGROUND OF THE COMPANIES INVOLVED IN THE
STUDY (N = 61)
n %
Types of product produced
Assembly 10 16.4
Plastic parts 11 18.3
Metal parts 27 44.3
Electronic parts 10 16.4
Electrical parts 9 14.8
Rubber parts 2 3.3
Company age (year)
New (<10) 8 13.1
Intermediate (11-20) 26 42.6
Old (>20) 26 42.6
Company ownership
100% local 30 49.2
100% foreign 9 14.8
Joint venture 22 36.1
Company size (no. of employee)
Medium (51-150) 14 22.9